Economic Growth and Employment

Andrew Bridgen Excerpts

Wednesday 23rd November 2011 Commons Chamber

[Andrew Bridgen (North West Leicestershire) (Con)]

The hon. Gentleman echoes the shadow Secretary of State in criticising the Government for undertaking quantitative easing. In truth, this Government and the previous one undertook quantitative easing, but there is a huge difference between them. This Government are using QE to buy bank debt to put liquidity into the banks, which is much needed by business, whereas the previous one used QE to buy Government debt, because at the time, the rest of the world had lost confidence in buying it.

[Gordon Banks]

I never mentioned quantitative easing—I was talking about term loans. Term loans are being offered to businesses because they are better for the lender, not the borrower, and because they deliver a skewed figure into the Merlin arrangements. That cannot be acceptable. Business should not be run on term loans.

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[Andrew Miller]

That was certainly the case with the Regulatory Reform Committee—it used the framework of the House to make limited adjustments—but we should remember the legacy left by Sir William Sargent, who did an amazing amount of work leading the Better Regulation Executive and putting in place the framework now being utilised. To ignore his work would be an insult to a fine public servant.

On skills, I am pleased that the apprentice Minister or the Minister for apprenticeships—whichever way it is—is here. I understand that he has indicated his wish to visit West Cheshire college. He is most welcome to visit that fine college built with resources provided by Labour but I would like him to think about some issues, particularly the needs of apprentices and young people coming to train from areas of extreme deprivation. There are many simple things that he could urge the Treasury to think about. For example, in my area there are plenty of vocational courses leading to jobs in specialist sectors, yet young people from deprived areas who, had they stayed on at school, would have got free school meals get no support to help them eat when at college.

TTE training runs a good training centre in my constituency providing Cogent training courses—I recently had the great pleasure to attend the royal visit to the centre organised at the behest of the royal family. That training centre is doing fantastic work at the high end of the petrochemicals sector—with players such as Shell and Ineos Chlor—but it is having difficulty finding a financial solution to deal with the needs of small and medium-sized enterprises. The Secretary of State will know that in Germany the burden is often placed on the large players, which are encouraged to finance the supply chain. That is one possible solution but the important point is that we need a practical solution, otherwise we will have no way forward and the young people making themselves available to go on such courses will be—

[Andrew Bridgen]

The hon. Gentleman is being mischievous by suggesting that there was a great deregulatory fervour about the previous Labour Government. For the past eight months he has served assiduously alongside me on the Löfstedt review looking at the reform of health and safety law. Would that review have been carried out under the previous Labour Government? Should it have been carried out? If so, why was it not?

[Andrew Miller]

I do not want to be tempted to comment on the review because it would breach the embargo—of course, the hon. Gentleman and I have seen its contents—but I shall be happy to express my views publicly in days to come. However, there is a fair amount of agreement between him and me on this point so I ask him not to tempt me down that line.

Mention has been made of the serious issue of the science base. The Secretary of State has got to get to grips with the confusion in the university sector. A combination of things has impacted on the universities, such as the fees structure changes, the capital spend problems and the overseas student issue. Yes, it is welcome that millions of pounds are being spent on a graphene centre in Manchester, but would it not have been ironic that had these rules been in place, Andre Geim might not have been at Manchester university to make those fantastic discoveries? The Government have to think carefully about the possibility of damaging a £5 billion industry that provides us not only with a superb base for our own research and development and science-based companies, but with a huge export of knowledge, which improves our relationship with so many of the countries with which we do business. I urge the Government to rethink what they are doing in the university sector.

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[Siobhain McDonagh]

I agree completely with my hon. Friend. I am making this speech because I want the Government to be sure that they know what individual small businesses and manufacturing businesses are saying on the ground.

[Andrew Bridgen]

rose—

[Siobhain McDonagh]

I do not want to take up too much time because I know others have things to say. I am seriously concerned about HMRC’s handling of casework and I do not think that it has the capacity to balance its role in raising taxes with its key role in generating economic growth. I hope that we can explore this concern on future occasions. I am grateful for the opportunity to let the House know how my constituents feel.

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[Stephen Metcalfe]

I put the two hand in hand. [Interruption.] Yes I do. The Government have a cogent plan, but as I say, they have to deal with the reality that we inherited.

As I was saying, the Labour party just loves to spend other people’s money. We all like to spend money: it give us that warm glow inside, but I imagine that the rate at which Labour has spent money, and wants to spend it again, would give a white-hot glow. Labour Members do not even try to hide the fact that they spent all the money. The right hon. Member for Birmingham, Hodge Hill (Mr Byrne) informed us in his now infamous note that there was no money left. Again, it falls to us to clear up their mess.

[Andrew Bridgen]

The hon. Member for Mitcham and Morden (Siobhain McDonagh) talked about problems at the Inland Revenue, but is not the truth that the botched merger with Customs and Excise has meant a vast deterioration in performance, which has affected many of my constituents? That is the fault of the Labour Government.

[Stephen Metcalfe]

I could not agree with my hon. Friend more. That is another problem that we have to sort out by clearing up the mess left by the previous Government.

Despite what Labour Members say and despite the sentiment behind this motion, we are, I believe, making good progress. As we have heard, we are creating the most competitive tax system in the G20; we are investing in businesses to help them start up and grow; we are encouraging inward investment and supporting exports; we are investing in science and technology and creating a more educated and more flexible work force. Of course there is still more to do, and I believe we are doing it.

For example, today, my right hon. Friend the Business Secretary announced new reforms to employment law—mentioned by the hon. Member for Streatham (Mr Umunna)—as part of the Government’s plan for growth, which will cut unnecessary demands on business while safeguarding workers’ rights. However, if we listen to the instant reaction from Labour, we find that they would have us believe that these measures are anti-employment and the reforms are about making it easier for companies to fire staff. I believe that the reverse is true. The Opposition spend a lot of time trying to cast employers as the bad guys—as a group of money grabbers trying to get rich off the backs of the workers.

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[Roberta Blackman-Woods]

I am sorry; I am running out of time.

We know that the RDA helped to invest in a new generation of advanced technologies with expanding markets around the world, which greatly helped growth in the north-east. Through industry, Government and university collaborations, a number of sectors were identified in which growth should be prioritised, including the processing and chemical industries, automotive and advanced manufacturing, and printable electronics. Those sectors, critically, were underpinned by centres of excellence supported by the regional development agency.

Did the incoming Government seek to build on that? No. What they did instead was get rid of One North East, although it had extensive support from businesses and the community in the north-east, and what we have in its place is the regional growth fund, about which I shall say more in a moment. The loss of the regional development agency led to a loss of expertise in regard to the sectors that needed to be developed in the north-east, and a loss of what was necessary to support that development. In great contrast, the regional growth fund not only has less money but is not strategic at all. I am very pleased that a number of north-east companies have benefited from the RGF, although the Secretary of State must address the fact that getting the money through to the companies is taking a long time.

[Andrew Bridgen]

Will the hon. Lady give way?

[Roberta Blackman-Woods]

No; I am sorry, but I am running out of time.

The RGF along with local enterprise partnerships and enterprise zones do not by any stretch of the imagination add up to an economic policy for growth for the north-east, or for anywhere else for that matter, because they are fragmented initiatives with no local coherence. The RGF will not help to narrow the north-south divide, either. As I have acknowledged, a number of companies in the north-east have benefited from the RGF, and according to the Government’s own figures that will secure about 8,500 jobs, but in the same RGF round money went to the south-east to secure 30,000 jobs.

The north-east’s problems are compounded by the fact that the RGF money is not a sufficient injection to the private sector to enable it to make up for the jobs that are being lost in the public sector. To put the figure of 8,500 jobs in context, last month alone unemployment in the north-east rose by 19,000. The Government must do more, therefore. In the past couple of weeks a number of independent commentators, including the North East chamber of commerce and PricewaterhouseCoopers, have said that the Government need to do more to support private sector development in the north-east, and our five-point plan for growth sets out a clear way for them to start supporting the economy.